Investor’s terms and responsibility for social investing
Investment is a process of gaining some profit in near future. For an investor, the investment depends upon the trading nature, desire, dedication, investor’s background and portfolio. It is always good to invest the money in a well-known item that can let you gain some higher profit. But it’s not alone to invest only for making money. Here is an important significance of social investing.
Risk and Return factor
Investors have their own mind to invest their money in risk-return spectrum. Someone can invest his/her money where the risk is lower and the return is quite comfortable according to the spectrum where the same investor can invest his/her money in such business which is a little bit higher in risk but returns also high value.
Social investment gains a lot of attraction among the investors and companies. It comes because of the globalism and new trend of business policies. A traditional investor invests his capital to the market considering two aspects. They took their investment decision in factors of financial returns and risk.
Social investing is has a significant role in the business in terms of making a profit by doing the same business with consideration of social impact. Social impact implies that the company which is invested by the investment fund can return some part of its benefits to the society, which is earned for the investors.
Investment for Social screening
Investors have their idea about the social condition which needed to be considered for the change and they invest their money to meet that standard. Investors invest his/her sum in the socially responsible companies which have previous records of helping the society any kind of improvement of the environment or the benefit of people who needed. Not only benefit the society but it also means to make a profit for the company as well as the investors.
It is also known as community investment in social investing. Investors find some companies who are really doing well in social aspects like a charitable program or another social purpose which needed badly and also generate profit to support the investment fund. These companies are kind of company which is profitable or non-profitable enterprises and these can’t make a huge in the capital market and the investment is shaped as a loan or notes.
So an investor can spend his sum in the enterprises that are in the housing sectors. They can support the poor people by giving small loans. Another investment is micro finance sector where people get small loans. It can help to start and grow business himself/herself and make them relief from the poverty. It same like a bank but it reaches to the people easily and makes a profit with helping the people itself.
Lots of sectors are there like community development, fair trade etc. that is the place of investment.
From the globalism effect, the companies are very much aware of the social responsibilities and investors also know the positive fact of society for their business. Companies need to find those investors who are comfortable to relax some of the return of his money for the social benefit.